Long-term targets

January 20, 2015, Novozymes updated its long-term targets for the period 2015-2020.

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Our long-term targets reflect Novozymes' integrated business approach. Besides our ambitions for sales growth and financial returns, the environmental and social areas of particular importance to our business are resource efficiency, environmental footprint, and sustainability leadership.

Long-term financial targets

Novozymes’ long-term financial performance is measured through the rate of annual organic sales growth in local currency, the EBIT margin and the return on invested capital (ROIC) including goodwill.

Organic sales growth

Novozymes’ long-term organic sales growth target is 8-10% in local currency on average throughout the period from 2015 to 2020.

EBIT margin

Novozymes’ long-term target for the EBIT margin is 26% and above. The target is expected to be achievable throughout the period 2015-2020.

ROIC incl. goodwill

Novozymes’ long-term target for ROIC including goodwill is 25% and above. The target is expected to be achievable throughout the period 2015-2020 on an average basis.

Long-term sustainability targets

In order to measure our impact on the world as well as our own sustainability, Novozymes has two types of sustainability targets: impact targets and operational targets. Both sets of targets are integrated into incentive schemes throughout the organization to align the company’s performance and direction.

Impact targets

We will measure the success of our purpose statement and strategic focus areas using a number of new long-term impact targets. These targets reflect our belief that increasing the use of our biological solutions will have a real and positive impact on the world.

Reach– We want to reach 6 billion people by 2020. Our solutions touch people’s lives across the world, and nowhere does sustainability become more real than when people have access to products that combine high performance and a small sustainable footprint.

Educate– We want to provide knowledge of the potential of biology to 1 million people from 2015 to 2020. We want to step up our contribution – from training in factories to local-community outreach to involvement with universities and business schools. Education is a precondition for global sustainable development, and we have a lot to offer. This target will challenge us to share knowledge and insights outside of Novozymes. The more people we can educate, the more can take part in creating sustainable biological solutions in the future.

Catalyze– We want to catalyze five global partnerships for change from 2015 to 2020: high-impact partnerships with public and private organizations to create answers for a sustainable world. Good examples include The BioAg Alliance, which is working on making a sustainable change in modern agriculture, and the U.N.-led Sustainable Energy For All initiative. We want to play our part in rallying the willing to make the changes the world needs.

Deliver – We want to deliver 10 transformative innovations from 2015 to 2020 that really change the lives of many people. Every piece of innovation we deliver has an impact, and this target is a reflection of our power to create technological breakthroughs.

Save– In 2020 we want to save the world 100 million tons of CO2 a year through customers applying our products.

Enable– We want to enable Novozymes employees to develop. It is our ability to ensure that employees develop their skills that will determine how successful we are. We will do this on an ongoing basis, but have set an ambitious target for 2020 in our annual employee survey.

Operational targets

The long-term operational targets for sustainability below reflect Novozymes’ ambitions to constantly increase the sustainability of its operations across the value chain to lead by example and ensure the long-term sustainable development of Novozymes as an international, inclusive and successful company.

With an updated baseline of 2014, we will strive to achieve the following by 2020:

Environment

·30% improvement in energy efficiency over 2014

·25% improvement in water efficiency over 2014

·25% reduction in CO2 intensity over 2014

·30% of our energy to come from renewable sources

·99% adherence to our supplier program for commercial, quality and sustainability performance

·Gold Class rating from RobecoSAM in the Sustainability Yearbook

People

·≤ 1.0 occupational accident per million working hours

·≤ 2.0% employee absence

·≥ 75 score for “satisfaction and motivation” in our employee survey

·≥ 75 score for “opportunities for professional and personal development” in our employee survey